Exchange Bonus: Is it just a marketing gimmick?

This is a discussion on Exchange Bonus: Is it just a marketing gimmick? within The Indian Car Scene, part of the BHP India category; Simply look at the difference between the new and the old.
If the difference is substantial then try and sell ...

It definitely is a marketing gimmick. Recently I went to Concorde Motors Blr to enquire for the Manza in exchange for my Swift. TO MY SHOCK they quoted 4.35 lacs for my 2010 July Swift Diesel. Just add the 50k 'exchange' bonus and you get the market price of my car. It is like 'fooling' the public.

On the contrary, today Ford evaluated my Swift D. They are currently offering me upto 4.9 lacs and still negotiating. But please note that Ford doesnt provide exchange bonus, though the agents are just helping me get the best price. I was looking at the Fiesta Classic diesel.

Generally out of the declared exchange bonus some percentages is footed by the manufacturer and the rest by the dealer. If you see the maruti ads against the * mark it will be in fine print that the offers are by dealers. This bonus is generally for non moving models and also a mode for a discount without announcing a price cut.
Needless to say that it is a gimmick.

Last edited by rajeev k : 6th January 2012 at 00:09.
Reason: correction

Yes, IMO exchange bonus is a marketing gimmick, 8 months back my WagonR was quoted by a Maruti dealer for 1.9 lacs with 25K bonus. When I checked with True value they quoted for 2.15 lacs and I sold it to a individual for 2.25 lacs. So, better check the rate from individual buyers also.

I would try my best to sell the car to an individual through any groups or friends circle. This will help me to finish the transfer process without any hiccups.

In case of selling the car to dealer, the car will still be in your name till the dealer sells the car. So, you will have to follow up with them frequently till the car is sold and transferred to the buyer. I have seen people buying cars from these kind of dealers but not transferring the car to their name. There is a risk involved when the car is not transferred to the buyer.

With no disrespect to anyone, i am not sure i completely understand the question BBlost asked and if the corresponding responses answer that question.

Apart from the Carwale evaluation, I am reasonably sure that he would have evaluated the car against what was being offered by the dealer (exchange bonus+buy in value), what the value of the vehicle is in the open market, what other dealers are willing to pay for it and the way he valuates the car (taking into consideration extras like Alloys, double din displays, etc). He would then choose to go with whichever channel gives him the maximum value and that's pretty much decided too.

Or are we talking purely about the term 'exchange bonus'? In effect, one would club that with the price the dealer is willing to pay for the car and that would be one 'head' in my calculations. I believe most of these terms like 'exchange bonus' and such are just terms thought up by Marketing folk to make the buyer feel they are getting more bang for their buck and thats that. What matters is how much value you are actually getting for the car.

I got a great deal last year - a valuation of 2.55 lacs for my 2006 45K run Swift P for + 30 K exchange bonus (bought a i10 AT) + 25K discount. I removed my ICE as well and could use the Swift till the day of the exchange.

I got quotations from 6 Hyundai dealers. The lowest was 2.2. A couple were able to come up with the 2.55 offer. The colour was green, not so liked.

I also put in TBHP/Carwale ads/contacted a couple of brokers. The best quotation I could manage was 2.5. While carwale said the max. could go to 2.8, I never saw such offers post waiting for a couple of weeks.

Hi everybody
I also think it is a marketing gimmick.
When i asked my dealer he gave me a quote of rs 2.25 lacs for a Beat(15 month,AC,music system,reverse sensors etc 11000 km)
Felt it was too low.Couldnt mentally accept a car to depreciate from 4.40 to 2.25 in 15 months.
Can somebody please give a back of the envelope how much should it depreciate.
Thanks and regards

Hi everybody
I also think it is a marketing gimmick.
When i asked my dealer he gave me a quote of rs 2.25 lacs for a Beat(15 month,AC,music system,reverse sensors etc 11000 km)
Felt it was too low.Couldnt mentally accept a car to depreciate from 4.40 to 2.25 in 15 months.
Can somebody please give a back of the envelope how much should it depreciate.
Thanks and regards

Well models like the Beat which have a lot of discounts running on them, will obviously depreciate very highly if the model goes on discount after you buy it. You also would have to factor in the insurance cost of around 15k which would have gone into your OTR.
I would think a Beat of your age would fetch arnd 2.6 to 2.75 lakhs if it were well maintained.

Exchange bonus is now being offered not only for cars but also two wheelers traded for cars such as Nano. Now would one get a better deal rather than selling it outside is another question. Some of the people known are but very excited to dispose their old bikes while hunting for their new ride.

May be off topic: Many times exchange bonus is used loosely with loyalty bonus. Some time back my friend went in to trade in a 800 for a Swift. Maruti offers loyalty bonus for the cars of its own make but the dealer called in both terms.

So it sounds like when you trade in a vehicle of another make it is exchange bonus and of the same make it would be loyalty bonus. Correct me if wrong.

When I booked for XUV there was no exchange bonus offered for my 2003 Indica V2 DLE done around 1lakh KM and in excellent condition.
The price that M&M quoted was around 90K which was not even 2/3rd the amount that was offered to me directly, so finally sold my trusted Indy for 1.4 lakh Rs.
My opinion about exchange bonus? -- It's a gimmick :-)

i have booked a BMW 320d LCi. There is a Rs 75000/- exchange bonus. I was told that the bonus comes from BMW india and it will be available 2-3 months after i submit the Transfer-RC. is there is any clause that the person that you sell can not have the same address as the original RC. can i transfer to my wife or any relative and still claim the exchange bonus. Please advice